In keeping with the topic of the last post, and also in the “for what it’s worth” column, I want to comment on some things Matthew Yglesias has written recently on his blog concerning the government structure of Iceland here and here.

His comments are interesting because they seem quite unlike any political ideas I have ever heard voiced in this country. Not that the views aren’t shared by others; they probably are, but, as I wrote in the last post, the surface view of the political dialog in this country tends to fall generally on one of two sides broadly labeled conservative and liberal. And as the standing generalizing theory goes, one of these sides wishes for a complete package of limited government, deregulation, low taxes, and an emphasis on a free market and the private sector, and the other side wishes to see more effective government, more regulation, and better public services with substantial taxation, particularly on the wealthiest, to pay for such functions and so on and so forth.

Yglesias, commenting on a Cato Institute blog assessment that Iceland’s prosperity has been primarily due to free-market policies, writes, “When I visited Iceland it struck me as more a Scandinavian social democracy than a free market paradise.” He explains that Iceland’s free-market policies (e.g. light regulation providing a “flexible labor market” and reduction in corporate taxes) seem to be accompanied by relatively high taxes (though I think their tax structure is quite different that ours), sizable social spending and an emphasis on “generous public services.” Because of this, he says, “I would love to see the US become more like Iceland — flexible labor market, high taxes, and generous public services sounds good to me.”

It is very interesting to me how he simultaneously wishes for those three things, though the first one is not quite specific, and he seems to equivocate and oversimplify on the issue, joining “flexible labor market” vaguely with all deregulation saying, “The movement, started under Jimmy Carter then of course continued by Ronald Reagan and Bill Clinton, to deregulate important aspects of the American economy was basically a good thing…” But the caveat for him, however, is we haven’t “built the strong welfare state and generous public services to go along with it.”

I am mostly interested in his general suggestion here that living with high taxes would not be a terrible bother in his view so long as there is light regulation in the area of jobs and business and hefty (and I assume high quality) public services, to which the people are entitled, promoting a generally healthy quality of life.

I feel that this idea has a rather different nuance than most we are used to hearing. Of course, as Yglesias acknowledges, many point out that it makes little sense to compare the U.S. with a “small, homogeneous” country like Iceland. I can think of several reasons why a country as vast, mixed, restless and heavily armed as the U.S. would not adopt a similar system, especially because many Americans have had a history of feeling oppression comes through taxation. But it is interesting, nonetheless, to imagine a different way of doing things with perhaps a different idea of quality of life, and so Yglesias’ desire would probably have to come under different circumstances and maybe even different values, i.e. a society not largely centered around individual consumerism. But I don’t know; I would like to look much more at the way people live and how the governments work in Iceland and the Scandinavian nations in comparison with the U.S.

As of yet, I haven’t really formed much of an opinion on this nor can I say much of details. I simply thought it would serve as food for thought and an interesting side note to the subject matter of the last post. To tell the truth, the full extent of confident knowledge I have of Iceland currently is only that it is an incredibly beautiful country inhabited by people who create some of the greatest music in the world. And that is good enough for me.